Key Words Key Words Overnight Auto Service Practice

Key Words • Key Words

Overnight Auto Service • • • Practice with Accounts and related numbers Debits/Credits Normal Balances Ledger Trial Balance

Journal Entries--1 • Journal Entry 1 Date Jan 20 Account Cash Capital Stock Michael Bryan and family invested $80, 000 cash in exchange for Capital Stock. Debit Credit 80, 000

Journal Entries--1 • • The business is receiving cash. Cash is increasing from the business standpoint. Cash is increasing. DADE Capital Stock is being issued. CLRRC

Journal Entries-2 1 -21 Land Cash On 1 -21 The business purchases land from the city paying cash of $52, 000. 52, 000

Journal Entries--2 • Land is debited because Land is increasing for the corporation. DADE • Cash is being paid.

Journal Entries--3 • Journal Entry 3 1 -22 Building Cash Notes Payable Purchased an abandoned building for, $36, 000, paying $6, 000 down and issued a 90 -day non-interest bearing note for the remaining $30, 000. 36, 000 30, 000

Journal Entries--3 • Building an asset is increasing. DADE • Notes Payable a liability is increasing. CLRRC • Cash is decreasing.

Journal Entries--4 1 -23 Tools and Equipment Accounts Payable Overnight purchased tools and equipment on account from Snappy Tools. The purchase price was $13, 800 due in 60 days. 13, 800

Journal Entries--4 • Tools and Equipment, an asset is increasing. DADE • Accounts Payable a liability is being increased. CLRRC.

Journal Entries--5 1 -24 Accounts Receivable Tools and Equipment On January 24, Overnight sold the excess tools to Ace Towing, at a price of $1, 800, which is Overnight’s cost. . 1, 800

Journal Entries--5 • Accounts Receivable an asset is being increased. DADE

Journal Entries--6 1 -26 Cash Accounts Receivable Overnight received $600 in partial collection of the account receivable from Ace Towing. 600

Journal Entries--6 • Cash an asset is increasing. DADE • Accounts Receivable an asset is decreasing.